AGR2024-014 MARICOPA COUNTY SHERIFFS OFFICE - UNLAWFUL TRAFFICKING MEDICAL MARIJUANA_FOR SUPPLIER SIGNATURE FINAL.PDF
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AGREEMENT
AGR2024-014
1
BETWEEN
The Arizona Department of Health Services (“ADHS”)
and
MARICOPA COUNTY SHERIFF’S OFFICE (“MCSO/Contractor”)
1. Term of the Agreement:
The term of this Agreement will be five (5) years.
2. Contract Extension:
By mutual written contract amendment, this Agreement may be extended as deemed necessary. The total
Contract term, including extension, shall not exceed a total of five (5) years from the effective date of the
Agreement.
3. Agreement Type
The Agreement shall be fixed cost.
4. Termination:
4.1
This Agreement remains in effect until terminated in accordance with the provision A of this section, or
as otherwise provided below:
4.1.1 Termination without Cause
Both the ADHS and the Contractor may terminate this Agreement at any time with sixty (60)
calendar days’ notice in writing specifying the termination date. Such notices shall be given by
personal delivery or by certified mail, return receipt requested. If the Contractor terminates this
Agreement without cause, the Contractor shall pay the ADHS the Agreement price for all services
and materials completed up to the date of termination;
4.1.2 Termination for Default
The ADHS reserves the right to terminate the Contract in whole or in part due to the failure of the
Contractor to comply with any material obligation, term or condition of the Agreement, to acquire
and maintain all required, bonds, licenses and permits, or to make satisfactory progress in
performing the Agreement. The Contractor should receive written notice detailing the area of non-
performance and have thirty (30) days to correct non-performance prior to termination for default;
4.1.3 Cancellation for Conflict of Interest
Pursuant to A.R.S. § 38-511, the ADHS may cancel this Agreement within three (3) years after
Agreement execution without penalty or further obligation if any person significantly involved in
initiating, negotiating, securing, drafting or creating the Agreement on behalf of the ADHS is, or
becomes at any time while the Agreement or an extension of the Agreement is in effect, an
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2
employee of or a consultant to any other party to this Agreement with respect to the subject matter
of the Agreement. The cancellation shall be effective when the Contractor receives written notice
of the cancellation, unless the notice specifies a later time. If the Contractor is a political subdivision
of the ADHS, it may also cancel this Contract as provided in A.R.S. § 38-511; or
4.1.4 Mutual Termination
This Agreement may be terminated by mutual written agreement of the parties specifying the
termination date and the terms for disposition of property and, as necessary, submission of required
deliverables and payment therein.
5. Health Insurance Portability and Accountability Act of 1996 (HIPAA):
The Contractor warrants that it is familiar with the requirements of HIPAA, as amended by the Health Information
Technology for Economic and Clinical Health Act (HITECH Act) of 2009, and accompanying regulations and
will comply with all applicable HIPAA requirements in the course of this Contract. Contractor warrants that it
will cooperate with the Arizona Department of Health Services (ADHS) in the course of performance of the
Contract so that both ADHS and Contractor will be in compliance with HIPAA, including cooperation and
coordination with the Government Information Technology Agency (GITA), Statewide Information Security and
Privacy Office (SISPO) Chief Privacy Officer and HIPAA Coordinator and other compliance officials required by
HIPAA and its regulations. Contractor will sign any documents that are reasonably necessary to keep ADHS
and Contractor in compliance with HIPAA, including, but not limited to, business associate agreements.
If requested by the ADHS Procurement Office, Contractor agrees to sign a “Pledge To Protect Confidential
Information” and to abide by the statements addressing the creation, use and disclosure of confidential
information, including information designated as protected health information and all other confidential or
sensitive information as defined in policy. In addition, if requested, Contractor agrees to attend or participate
in HIPAA training offered by ADHS or to provide written verification that the Contractor has attended or
participated in job related HIPAA training that is: (1) intended to make the Contractor proficient in HIPAA for
purposes of performing the services required and (2) presented by a HIPAA Privacy Officer or other person or
program knowledgeable and experienced in HIPAA and who has been approved by the GITA/SISPO Chief
Privacy Officer and HIPAA Coordinator.
6. Utilization of Confidential Information:
6.1
Contractor agrees not to use or disclose confidential medical information or personally identifying
Information other than as permitted by this MOU or as required by law,
6.2
Contractor agrees to use appropriate safeguards to prevent use or disclosure of confidential medical
information or personally identifying information other than as provided by this MOU,
6.3
Contractor agrees to mitigate, to the extent practicable, any harmful effect that is known to Contractor
from a use or disclosure of confidential medical information or personally identifying information other
than as provided by this MOU,
6.4
Contractor agrees to report to the ADHS any use or disclosure of confidential medical information or
personally identifying information not provided in this MOU of which it becomes aware, and
6.5
Contractor agrees to ensure that any agent, including a subcontractor, to whom Contractor provides
confidential medical information or personally identifying information received from the ADHS or created
or received by Contractor on behalf of the ADHS agrees to the same restrictions and conditions that apply
through this MOU to Contractor with respect to such information.
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7. Discrimination:
The parties hereto mutually agree that at no time will race, creed, color, sex, or other similar criteria be employed
by either the ADHS or the Contractor for the purpose of discrimination, whether as to employees, applicants for
employment, interns, clients, or patients. To the extent applicable to the Agreement, both parties hereto agree
to comply with all state and federal laws, rules, regulations, and executive orders as to equal employment
opportunity, non-discrimination, including Arizona Executive Order No. 2009-09 prohibiting discrimination in
employment, and further agree that the terms of Executive Order 2009-09 are incorporated herein by reference.
.
8. Records:
Under A.R.S. § 35-214 and § 35-215, the Contractor shall retain all data and other records (“records”) relating
to the Agreement for a period of five (5) years after the completion of the Agreement. All records shall be
subject to inspection and audit by ADHS at reasonable times. Upon request, the Contractor shall produce a
legible copy of any or all such records.
9. Arbitration:
The parties to this Agreement agree to resolve all disputes arising out of or relating to this Agreement, after
exhausting applicable administrative review, through arbitration to the extent required by A.R.S. §12-1518.
10. Indemnity Clause:
Contractor shall indemnify, defend, save and hold harmless the State of Arizona, its departments, agencies,
boards, commissions, universities and its officers, officials, agents, and employees (hereinafter referred to as
“Indemnitee”) from and against any and all claims, actions, liabilities, damages, losses, or expenses (including
court costs, attorneys’ fees, and costs of claim processing, investigation and litigation) (hereinafter referred to
as “Claims”) for bodily injury or personal injury (including death), or loss or damage to tangible or intangible
property caused, or alleged to be caused, in whole or in part, by the negligent or willful acts or omissions of
Contractor or any of its owners, officers, directors, agents, employees or subcontractors. This indemnity
includes any claim or amount arising out of or recovered under the Workers’ Compensation Law or arising out
of the failure of such Contractor to conform to any federal, state or local law, statute, ordinance, rule, regulation
or court decree. It is the specific intention of the parties that the Indemnitee shall, in all instances, except for
Claims arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnified by
Contractor from and against any and all claims. It is agreed that Contractor will be responsible for primary loss
investigation, defense and judgment costs where this indemnification is applicable. In consideration of the
award of this Agreement, the Contractor agrees to waive all rights of subrogation against the State of Arizona,
its officers, officials, agents and employees for losses arising from the work performed by the Contractor for the
State of Arizona.
11. Insurance Requirements:
Both parties shall maintain (i) commercial general liability insurance coverage with minimum limits of
$1,000,000, combined single limit, and (ii) professional liability insurance coverage with minimum limits of
$1,000,000 with respect to the negligent acts and omissions of personnel to the extent provided under the State
of Arizona Department of Administration Risk Management Division. Upon written request both parties shall
provide to the other party a certificate of insurance evidencing such insurance coverage.
A Certificate of Insurance evidencing such coverage shall be furnished to the ADHS prior to commencement of
the clinical educational program, said Certificate to include the commitment of the insurer not to cancel the
coverage without at least thirty (30) days’ prior written notice thereof to the ADHS.
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12. Amendment or Modifications:
No amendment or modifications to this Agreement, including any amendment or modification of this paragraph,
shall be effective unless the same is in writing signed by the parties.
13. Arizona Law:
The law of Arizona applies to this Agreement including, where applicable, the Uniform Commercial Code as
adopted by the State of Arizona.
14. Relationship of Parties:
The Contractor under this Agreement is an independent Contractor. Neither party to this Agreement shall be
deemed to be the employee or agent of the other party to the Agreement.
15. Severability:
The provisions of this Agreement are severable. Any term or condition deemed illegal or invalid shall not affect
any other term or condition of the Agreement.
16. No Parol Evidence:
This Agreement is intended by the parties as a final and complete expression of their agreement. No course
of prior dealings between the parties and no usage of the trade shall supplement or explain any terms used in
this document.
17. No Waiver:
Either party’s failure to insist on strict performance of any term or condition of the Agreement shall not be
deemed a waiver of that term or condition even if the party accepting or acquiescing in the nonconforming
performance knows of the nature of the performance and fails to object to it.
18. Headings:
Headings are for organizational purposes only and shall not be interpreted as having legal significance or
meaning.
19. Advertising and Promotion of Contract:
The Contractor shall not advertise or publish information for commercial benefit concerning this Agreement
without the prior written approval of an ADHS Procurement Officer.
20. Payment Procedures
20.1. ADHS accounting will not make payments to any Entity, Group or individual other than the Contractor
with the Federal Employer Identification (FEI) Number identified in the Agreement. Contractor invoices
requesting payment to any Entity, Group or individual other than the contractually specified Contractor
shall be returned to the Contractor for correction.
20.2. The Contractor shall review and insure that the invoices for services provided show the correct
Contractor name prior to sending them to the ADHS Accounting Office for payment.
20.3. If the Contractor Name and FEI Number change, the Contractor must complete an “Assignment and
Agreement” form transferring contract rights and responsibilities to the new Contractor. ADHS must
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indicate consent on the form. A written Agreement Amendment must be signed by both parties and a
new IRS W-9 form must be submitted by the new Contractor and entered into the system prior to any
payments being made to the new Vendor.
19. Reports and Records.
Each party shall establish and maintain records regarding its performance under this Agreement in accordance
with the records retention standards established by the Department of Library and Archives. Any
subcontractors shall be contractually required to retain all data and other records relating to the acquisition
and performance of this Agreement for a period of five years after the completion of the Agreement as required
by A.R.S. 35-214 and 35-215. All records shall be subject to inspection and audit by the State of Arizona
(State) at reasonable times.
20. E-Verify Requirements.
In accordance with A.R.S. § 41-4401, Contractor certifies compliance with all Federal immigration laws and
regulations relating to employees and warrants its compliance with Section A.R.S. § 23-214, Subsection A.
21. Audit
In accordance with A.R.S. 35-214, the Contractor shall retain and shall contractually require each
subcontractor to retain all data, books and other records (“records”0 relating to this Agreement for a period of
five (5) year after completion of the Agreement. All records shall be subject to inspection and audit by the
State at reasonable times. Upon request, the Contractor shall produce the original of any or all such records.
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AGR2024-014
1. Background
1.1.
The Arizona Medical Marijuana Initiative, or Proposition 203, was included on the November 2, 2010
ballot and approved by Arizona voters. The Proposition was certified on November 13, 2010, becoming
the Arizona Medical Marijuana Act (AMMA), A.R.S. Title 36, and Chapter 28.1. The AMMA and Medical
Marijuana Program Rules, A.A.C. Title 9, Chapter 17, allow for the registration, certification, and
regulation of nonprofit medical marijuana dispensaries by the Arizona Department of Health Services
(ADHS). ADHS may not issue more than one (1) nonprofit Medical Marijuana Dispensary Registration
Certificate (DRC) for every ten registered pharmacies in Arizona. Nonprofit medical marijuana
dispensaries that have been allocated a DRC must undergo an inspection and receive an Approval to
Operate (ATO) from ADHS prior to operating. Registered dispensaries may have one (1) additional
medical marijuana cultivation site that is either located at the location of the registered dispensary or
anywhere in the State where a cultivation site is allowed by the local jurisdiction. A registered dispensary
that has been given approval to operate by ADHS is required to post the DRC and ATO certificate in a
conspicuous place that can be viewed by individuals entering the dispensary and, if applicable, the
dispensary’s cultivation site. The ADHS maintains a record of all registered and approved dispensaries,
cultivation sites, and cardholders (qualifying patients, designated caregivers, and dispensary agents) in
Arizona. As per A.R.S. § 36-2810, certain information received and records kept by ADHS for the
purposes of administering the Medical Marijuana Program are confidential, with some exemptions
related to the release of information to law enforcement for falsified or fraudulent information or apparent
criminal violations.
1.2.
The Contractor is responsible for the enforcement of A.R.S. Title 13. As the local jurisdiction’s law
enforcement authority, the Contractor is situated to provide services related to the regulation of unlawful
marijuana trafficking taking place outside of registered nonprofit medical marijuana dispensaries,
including but not limited to operations/clubs conducting dispensary functions under a variety of
names/labels by persons representing themselves to cardholding patients and the public as acting within
the scope of AMMA; as well as services related to the regulation of unlawful marijuana trafficking taking
place at registered nonprofit medical marijuana dispensaries or cultivation sites, including activities at
dispensaries or cultivation sites that fall outside of and/or violate the AMMA.
1.3.
The Maricopa County Drug Suppression Task Force (MCDST) is a High Intensity Drug Trafficking Area
(HIDTA) Initiative. The Task Force is the primary responder in Maricopa County for clandestine
laboratories that produce illegal drugs or incidents involving unknown liquids or powders. This Task
Force also assists agencies throughout the state with clandestine drug laboratories that the requesting
agency is unable to dismantle or investigate themselves. The investigation and dismantling of
clandestine laboratories are a specialized skill which requires specialized training and equipment.
Clandestine laboratories have become more complex and dangerous. Laboratories have been making
higher potency drugs, including the latest epidemic of synthetic opioids. Some of these labs include not
just methamphetamine labs but synthetic cannaboids, DMT, Butane Honey Oil, Methamphetamine
conversion labs, bath salts and synthetic opioids to include Fentanyl. Several localized departments
have identified Marijuana Grows and Hash/Cannabis production as Clandestine Laboratories. These
two have different and unique hazards that are not only dangerous, but also could be deadly or lead to
serious bodily harm. In addition to investigating labs, this initiative has branched out to investigating
drug trafficking organizations operating out of the Phoenix Metro area. This Task Force also assists
agencies throughout the state with clandestine drug laboratories and investigations that the requesting
agency is unable to dismantle or investigate themselves.
1.4.
Currently the MCDST Initiative has been focusing on two fronts, one being the synthetic opioid crisis,
the second is to combat the illegal importation, cultivation/production, and selling of marijuana and
cannabis/hashish outside Arizona registered certified dispensaries. These investigations not only
happen both inside and outside the boundaries of the City of Phoenix, neighboring suburb cities,
Maricopa County and even the State of Arizona. Some of these investigations have led to large seizures
such as the largest indoor marijuana grow in the state’s history, the largest seizure of narcotic cannabis,
the dismantling of a large group using social media to sell marijuana and cannabis to hundreds of
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subjects including minors (operating in the Phoenix Metro Area). This investigation also found the
subjects in this investigation were not just cultivating or producing the marijuana/hashish here but also
importing product from both California and Colorado.
2. Objective
To provide funding to the Contractor for equipment, training and overtime (OT) services of existing staff with
responsibility for the regulation of activities within the local jurisdiction that fall outside of AMMA and under
A.R.S. Title 13, including but not limited to, unlawful marijuana trafficking taking place outside of registered
nonprofit medical marijuana dispensaries by persons that are representing themselves to cardholding patients
and the public as acting within the scope of AMMA; as well as services related to the dispensaries or cultivation
sites, including activities at dispensaries or cultivation sites that fall outside of and/or violate the AMMA.
3. Scope of Work
The Contractor shall:
3.1.
Personnel and Operations
Utilize funds to pay overtime for the MCSO and its contracted subrecipients when required by MCDST
or any other law enforcement agencies working with MCDST to strictly investigate or provide training on
illegal “dispensary” operations, marijuana grows and cannabis labs.
3.2.
Equipment Purchases
Establish a marijuana plant drying room, and obtain a cargo trailer to be used by the MCDST when
executing search warrants with the removal of Marijuana grow equipment or Cannabis/Hashish chemical
extraction equipment.
4. Tasks
The Contractor shall:
4.1.
Investigate allegations of unlawful marijuana trafficking taking place outside of registered non-profit
medical marijuana dispensaries; and allegations of unlawful marijuana trafficking taking place at
registered non-profit medical marijuana dispensaries or cultivation sites, including activities at
dispensaries or cultivation sites that fall outside of and/or violate the AMMA.
4.2.
Track and maintain OT hours for services related to investigations;
4.3.
Document and maintain records of the number of:
4.4.1.
Conducted investigations;
4.4.2.
Arrests related to unlawful marijuana trafficking; and
4.4.3.
Closures of unlawful marijuana trafficking operations taking place outside of registered non-
profit medical marijuana dispensaries as a result of investigations conducted by the Contractor.
4.5.
Provide reports that include:
4.5.1.
Number of Overtime hours related to investigations;
4.5.2.
Number of investigations; and
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4.5.3.
Arrests related to unlawful marijuana trafficking.
5. Deliverables
The Contractor shall provide:
5.1.
Provide Program Implementation Plan to ADHS, on an annual basis, no later than thirty (30) calendar
days from contract start date, including proposed total costs allocated to personnel, operations, travel,
direct and indirect costs; and yearly total project costs.
5.2.
Reports and other supporting documentation to the ADHS Medical Marijuana Card Registry Program
regarding individuals with Arizona Medical Marijuana cards (patients, caregivers or dispensary agents) who
have been arrested for possible card revocation. Reports shall be provided no later than thirty (30) business
days from the quarter end date
5.3.
Quarterly progress reports, in a Department approved format, no later than thirty (30) business days
from the quarter end date, illustrating all progress “to-date”.
5.4.
Quarterly Contractor Expenditure Reports (CER), for one quarter of the total amount every three (3)
months, in a ADHS approved and provided format, no later than thirty (30) calendar days from the
quarter end date; and, submitted to and copied to the designated Medical Marijuana Program point-of
contact; and
5.5.
Annual report, in a Department approved format, including, but not limited to, the identification of all
accomplishments of tasks and deliverables, to include a summary of all regulatory activities throughout
the contract period, no later than thirty (30) calendar days from the end date of the contract.
6. Notices, Correspondence and Reports
6.1.
Notices, correspondence and reports from the Contractor to ADHS shall be sent to:
Arizona Department of Health Services
Bureau of Special Licensing
Attention: Program Manager
150 N. 18th Ave. Suite 410
Phoenix, AZ 85007
6.2.
Invoices shall be submitted to: invoices@azdhs.gov
6.3.
Automated Clearing House
6.3.1.
ADHS may pay invoices for some or all Orders through an Automated Clearing House (ACH).
In order to receive payments in this manner, the Contractor must complete an ACH Vendor
Authorization Form (form GAO-618) within 30 (thirty) days after the effective date of the
Contract. The form is available online at: https://gao.az.gov/publications/forms
6.3.2.
ACH Vendor Authorization Form shall be emailed to Vendor.Payautomation@azdoa.gov
6.4.
Notices, correspondence, and reports (and payments if sent to same address) from ADHS to the
contractor shall be sent to:
Sergeant Jonathan Hannaman
Maricopa County Sheriff Office
550 W. Jackson Street
Phoenix, AZ 85003
Email: JonathanHannaman@mcso.maricopa.gov
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Cindy Kenney, Grant Administrator
Maricopa County Sheriff Office
550 W. Jackson Street
Phoenix, AZ 85003
Tel. 602-876-3266
Email: c_kenney@mcso.maricopa.gov
7.
Signatures/Approvals
For Maricopa County Sheriff’s Office:
For Arizona Department of Health Services:
__________________________________
___________________________________
Russ Skinner, Deputy Chief
Monique Harris, Procurement Supervisor
Date: _____________________________
Date: ______________________________
Maricopa County
_________________________________
Jack Sellers, Chairman
Board of Supervisors
ATTEST:
_________________________________
Juanita Garza
Clerk of the Board of Supervisors
APPROVED AS TO FORM
This _____ day of _____________, 20__
By:
______________________________
Deputy Maricopa County Attorney
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PRICE SHEET
ITEM
QTY
UOM
AMOUNT
TOTAL
Personnel and Operations/Program Costs
5
Quarters
$ 50,000.00
$ 250,000.00
Equipment Purchases
8
Quarters
$ 6,250.00
$
50,000.00
TOTAL NOT TO EXCEED AMOUNT
$ 300,000.00